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About Me

I'm a Green Blogger, and I'm making a go of Green Investing.

This Blog is a record of arguments and facts, as I find them, in demonstration of the coming transformation from a Fossil-based Economy, to one powered by Alternate sources, such as Wind, Solar, Bio, and others.

I can't say that all or even most of my calls so far have turned out right, so always do your own DD. A proper market depends on the broad range of opinions of its numerous participants in order to properly perform "price discovery." This blog represents my voice in this process. I am not to be held liable for any trading or investment decision made by anyone but myself. We are all ultimately responsible for our own decisions, and for the results of those decisions,whether positive or negative.

Wednesday, September 21, 2011

I’d like to demand in the strongest terms an investigation into the trading of LDK Solar Inc (LDK).

LDK has recently been on the Naked Short Threshold List for nearly a month, which indicates a high level of Fails-to-Deliver, and which can and does, in this case, indicate Fraudulent and Abusive Trading Practices.

Also of note is that LDK Solar had previously been on the Naked Short Threshold list for well over a year, prior to the financial collapse in ’09. At the time, known naked-short-sellers such as Mario Asensio and others were manufacturing allegations against the company, which, to this day, have never been realized.

For years, the Yahoo Finance Messageboard has been a hive of short-rumormongers alleging impending Bankruptcy and other false claims, and this continues today. Leadership of these public manipulators on Yahoo rests with members Twoheadedsnake1234 and Higherphat. Over the last 5 years, both have led in calls of impending bankruptcy and have made numerous demonstrably false claims.

Of particular interest at this moment are a set of private loans between the Company’s CEO and various Lenders, in which the CEO stands to be forced to give up his own shares in the case that LDK’s share price reaches predetermined levels. There is clearly interest in these shares, as demonstrated in LDK’s Q2 Earnings call, where two references were made to this situation, one by Colin Rusch of ThinkEquity and one by Sam Dubinsky of Wells Fargo[1].

The interest in these shares is clear today as Twoheadedsnake1234 initiates a thread entitled “Who said margin call wont happen,” in which he states “For reference in 2008 his loans were based on around $4- a share. This was something like 25M shares as security.” [2]

As can be seen in Figure 1, the reported Fails-to-Deliver Shares of LDK had reached as over 100% of Daily Volume on 08/30/2011. Additional data is provided below.

This is OUTRAGEOUS!

It cannot be that over a day’s worth of volume can be failed-to-deliver without having a significant and fraudulent impact on the price of the security. Somebody in this case is being stolen from. Shares that they purchased are not being delivered to the proper accounts, as agreed between the buyers and sellers, and Equity is systematically and illegally destroyed.

In the SEC’s own words:

“where a seller of securities fails to deliver securities on settlement date, in effect the seller unilaterally converts a securities contract (which is expected to settle within the standard three-day settlement period) into an undated futures-type contract, to which the buyer might not have agreed, or that might have been priced differently." By this definition, Naked Short Selling of stocks is certainly akin to Fraud. The buyer in this case has not agreed to the purchase of an undated futures contract. The buyer has agreed to pay for a share of Stock, which is not received.“ [3][4]

In addition to the contractual fraud that takes place by way of these Fails-to-Deliver, the proliferation of these Fails has a direct negative impact on the Price of the Shares. This has impact upon the very operational security of the Company, as rumors and artificially devalued share prices act to decrease the availability of financing to the company.

It’s quite clear from the expressed interest in these shares, held by the CEO, in conjunction with the exceedingly high levels of Fails-to-Deliver, that there is a concentrated effort by some on Wall Street to devalue of the shares to such point as margin can be called. By this process, these interests are illegally destroying the equity of Investors (and of Americans).

It’s known that the SEC will never publically discuss their interest or activity in investigating wrongdoing, and in fact, it is known that the SEC routinely destroys historical records of prior investigations [5]. However, it’s also known that over the last five years the SEC has received a very large volume of complaints about just this kind of trading practice that has surrounded LDK Solar, and if record of them has not been destroyed, these complaints could be shown to have come from a host of independent observers of this process.

This criminal activity must be investigated without delay. There is real fraud happening right now. It’s demonstrable, and it’s Criminal.

Tuesday, February 15, 2011

There's not alot of fear, but there's also not alot of dangerous exuberance. Those old-timers that are still in, are in with solid confidence. Newbies that have come in have quietly been growing value since the trend reversed. It's just a matter of when the next move is going to come.

Thursday, January 13, 2011

The main thrust is that Short Sellers have been generally making bank off of Chinese listings in the US. In particular, it's reverse mergers that are discussed, but you know that some of the same people have been targeting LDK even with its full IPO, and with the documentation and credibility that go with it.

Asensio is mentioned as the original source of a short target, and he has also previously put out a hit on LDK.

As LDK Investors, we have to our advantage the fact that there is such a culture of distrust of Chinese companies on Wall Street. When the selling culture gets so excited about an entire group of easily connected companies, they'll hit all of the companies, and in time, the ones that hit the wrong companies (LDK) will be destroyed, to the benefit of Longs.

In particular relation to Chinese Companies, it's quite likely that there are at least several "LDK's" out there. The growth in so many industries is simply so fast, that a bunch of Wall Street number crunchers can't handle it. They are naturally skeptical (and many are led by race / culture / nationality, rather than objective economic fact).

One point that I thought was interesting was a connection between the following statements describing the article's main character, John Bird of Austin Texas, and regarding Bird's short on Sky One ( CSKI ):

"By August 2009, Bird was ready to place a serious bet. He logged onto his account and sold short 30,000 shares at $15.70"

"Sky One’s shares retreated 69 percent in 2010, and Bird put $500,000 of his $1 million-plus in profits into a startup cancer drug company. His suit against Sky One’s auditors drags on. He’s still short 175,000 shares of the company and hopes the next salvo will come from the SEC."

So, in August of 2009, Bird sold 30,000 shares at $15.70, or $471,000. Per the article a 69% decrease in the price of the shares provided over $1 Million in Profits. So, he had to have shorted more around the peak of $22 at the end of 2009 (a margin call is described in the story). He takes out $500,000 Dollars in profit and ends up with currently 175,000 shares shorted.

Looking at CSKI at http://www.nasdaq.com/aspxcontent/shortinterests.aspx?symbol=CSKI&selected=CSKI puts their short interest at around 1.6 Million Shares, so Bird is sitting on a fat chunk of this interest, and he's helping to keep the supply of shares higher than the demand, and as of right now he and his buddies appear to be succeeding.

Fair and square.

Yet, he's pulled out $500,000 in "profit," and his short position has grown by almost 6 times, while the value of his short has only gone up around 4 times, at best (from $22 to $6).

So Bird has borrowed and sold a piece of this little company to the tune of 175,000 shares, or about a Million Dollars worth (at $6), he's sitting pretty with Greek Statues in the yard, as long as he doesn't ever end up having to value those shares at, say, $15. He's got lawsuits against the company, and everything. We know how this works.

But, what happens if some global "Sputnik Moment" were to dramatically raise the valuation of CSKI, overnight? He'd be screwed, wouldn't he? Remember, he started out with less than half a Million dollars in short risk on this company, and now, though he's taken profit, he's still sitting on more than twice the short risk, at less than half the price of the original short.

What does it mean when you take profit on a short, invest that money into some other company for shorts to shred, and end up with twice the short debt? I guess I don't know what it means, but I'd say that it's pretty clear that your lifestyle very much depends on those shares never coming into vogue (his position in this stock is about equal to one day's trading volume), because unlike buying long, if the trade goes badly the wrong way, he can't just sell the shares and capture some profit; he has to take money from SOMEWHERE ELSE and BUY shares (or his Broker will do it for him).

Ah well, something to think about in terms of general shorting practice, as potentially applied to LDK. As for CSKI, I don't know anything about it, and for all I know, Bird might be right.

Wednesday, September 1, 2010

I set out a week or so ago to try my hand at putting together an estimate for 2011 Global Demand for PV Solar. I started rough, and started adding details. I put out numbers and chewed on them a bit; considering the variables that I see in the Global Economy, and in the Solar Industry.

In the case of a double-dip recession in the US, which takes us to a state of barbarism, then all bets are off. You’re on your own.

However, if we can avoid a deflationary spiral, and if the powers that be can keep the US Economy just barely growing for awhile, then I think that continued Global Growth could lead to some interesting events.

I’ll start out with the document that I found last.

This is a detailed projection on the Global Solar Industry going out to 1014 (as of May 2010) by the European Photovoltaic Industry Association. In this document you’ll find PV Histories and Projections broken down by Country, and multiple demand scenarios.

The EPIA projects the Global 2011 Solar Market to be 15,405MW.

----------------------

Having found this document last, I had already put together a projection as follows.

This is my estimate, based upon rapid (but not earth-shattering) growth in China, as well as a not-complete collapse of the German Market.

My Rationale (for some major players) is as follows.

Germany: Germany is not going to completely crash, as some suggest. Prices ARE likely to decrease by at least 10%, which creates its own stimulative effect. In addition, the German Solar Industry is now quite powerfully entrenched, and will resist policies that put them all out of work. It's quite clear that Germany is looking for a bit of a slowdown, but with prices as they are, not only for Basic Equipment, but for Balance of System, there will still be continued opportunity to close new sales. In addition, where German players come into troubling times, they will to some extent, at least, look for opportunities to push Sales elsewhere to Europe, or the World.

With this in mind, I set Germany at a minimum of 5.5 GW on the year, compared to EPIA's estimate of 4 GW (and compared to iSupply's estimate of 9.5 GW).

US: Solar in the US is still tentative. There is tremendous cultural animosity against it. However, today's Prices (and Regulations) are getting tough to ignore. As Fully Loaded costs drop below $5/W, Solar starts looking realistic for certain niches. The big question mark, of course, is what will happen with the mid-term Election, and what will come of Energy Policy afterwords. I set the US Market for 2011 to be 2 GW, which is optimistic. Compared to just 2 years ago, today's prices are unbelievable, and even with a complete rout by the Republican / Tea Party, the Dems will maintain considerable power by which to support the development of Alternative Energy (the EPA and Energy Dept, for example).

China: China is a giant wildcard. So far, China has made big plans, but they've held the money tight. We know that folks like Xiaofeng Peng of LDK have made numerous trips around China and have set up Framework Agreements for the Construction of multiple Gigawatts of Solar Generation Plants, but these plants have yet to be realized. Other Chinese and International players have done likewise, with the same results.

There has been some activity, even so. EPIA suggests a potential 600 MW Market Size for 2010, which is a solid base upon which to take off from in '11 (pending access to funds). EPIA also notes that there are more than 12 GW of projects in the Chinese Pipeline.

So, where are the funds? There have been rumors. There have also been strongsignals of massive expenditure across the board in Alternative Energy (700+ Billion Dollars).

Rumors suggest that the plans might be announced officially as early as September. However, nothing is Official in Government until it's "Official." Unless you have contact with the inner circle in Beijing, I don't think they're going to tell you what their plan is; that is, until they're good and ready. However, it seems to me that beyond the rumors and tidbits of leaked news, we can make another kind of observation, which is to look at what their Manufacturers are doing.

Expansion is the word of the day. While Western Analysts call for another dieoff in 2011 due to Demand Contraction, Chinese Manufacturers are all expanding like gangbusters (while hiring and training a large number of people). They're profitable right now, and would remain profitable with a further 10% decrease in ASPs. However, if Europe dries up and prices fall precipitously, then the analysts will be right; unless China steps in. Energy is a strategic asset, and I don't see China just standing by (again) as their shiny new companies collapse in the midst of a rapid growth phase.

My conclusion, then, is that evidence of China's immanent entry to the Demand side of the equation, and in a big way, is simply the fact that this particular set of favored Companies appear to be expanding in preparation for it. This goes beyond the increasingly documented fact that there are specific plans in the works by the Central Government.

So, for China in 2011, I'm suggesting that 1.5 GW is a Conservative minimum in the case that the Chinese Government does, in fact, release the money. As of 12/6/2010, this quantity has some support from analysts.

Note, however, that the amount and manner of Investment will be as carefully tuned as possible to avoid putting too much upward pressure on the price of equipment. They don't want to disrupt exports and create a bubble.

So there you have it. Take it for what you will. I'm not a Pro, I'm an Interested Observer, and I've been wrong before.

Thursday, July 8, 2010

The second is to support the construction of two Manufacturing Plants to produce PV Panels, by Abound Solar. This worries me, because I'm confident that it's a bad long term investment.

I didn't follow up on the announcement right away, though I had looked up both projects briefly. I knew that Abound made Thin Film PV, but until a moment ago, I hadn't wondered WHAT KIND of thin film they were using. My heart sunk as I found that Abound Solar produces panels from Cadmium Telluride (CdTe).

What is he thinking??? Well, he doesn't know that he's been given very bad advice.

In brief background, CdTe is also the primary ingredient of Panels produced by First Solar (FSLR), as well as Abound Solar. Cadmium is somewhat rare on Earth, and Tellurium is incredibly rare.

I'm quite convinced that First Solar is the Betamax of Solar, and for the same reasons, I have to think that Abound is right there with them on the road to obsolescence.

The funny thing is, that though I might be wrong in some details, I don't hear any Solar Analysts asking for clarification of the issue, and I certainly don't see any of the respective manufacturers bringing it up. There are certainly potential raw materials risks in this area, and yet nobody is offering any easy or obvious solution to the problem.

So, here we have Obama putting money in support of a raw materials competitor with First Solar as if they are some prime symbol of America's technology knowhow, and yet, with some certainty, this will lead to a corresponding symbolic failure of a US CdTe Solar Industry in its competition against the Chinese Silicon-based Behemoth.

This is a failure of the Obama Administration, even if it won't be noticed as such for quite a long time.

Thursday, June 3, 2010

Obama is selling Nuclear. This is one of the few issues with which I really think he's screwing up.

The question is, even with more Government support, will the nuclear industry really get off its ass and start building plants? Nuclear energy is all about politics. Very little of it is real. The financiers won't invest in plants unless they can get the Government to take pretty much ALL of the risk.

So, as far as nuclear is concerned, we might get a bill that still won't produce any new plants. It would be good to see this bill if it's posted out there; I haven't looked.

On the other hand, can Obama really sell a MAJOR wealth redistribution Bill using SOLAR ENERGY as the argument? The US CULTURE doesn't support Solar. They think its for calculators. The Culture does support Nuclear, however. They (we) have been taught how SIMPLE and CHEAP nuclear power can be for generations. The fact that the REALITY doesn't end up supporting this (when the cost of the RISK is included) is not well understood by just about everyone (IMO).

So, does Obama Sell Solar and confuse the people (failing to pass a Bill), or does he sell NUCLEAR and move WITH the cultural assumptions in order to get a bill in that will also support Solar and other Renewables / Efficiency?

I don't know, it's a tough decision for alot of people politically, because it involves taking a SH!T-TON of money from a select group of Industries (Carbon Emitters) and giving it to Others. It's massive Government intervention, and people don't like that (even if it's required for their long-term survival, and even if it MIGHT turn out incredibly well).

Don't know.

A thought: Remember, the Solar Industry is tiny relative to total Global Energy Demand. Some talk like the amount of Global subsidy required to create vast demand for Solar Energy Products is some impossible number. What is a dollar, and how many of them are there in the World? There are a SH!T-TONS of SH!T-TONS of them in World. They're tied up in all manner of Derivatives... like a giant cloud of Dollars up in the sky that is able to exist without really affecting life down here on Earth (maybe a light misty rain every now and then). What happens if a Financial Regulation Bill passes that adds just a tiny percentage to the costs of dealing in most derivatives, and makes some derivatives illegal? Money has to go somewhere else. Is there a downpour?

Inflation? Money that doesn't go into a derivative will go somewhere else, where the costs are more well known. Assets, Businesses, Stocks and Options, maybe cars and other Consumer Goods of Particular Value.

When Oil decides to go up (in Dollars) (It Will), then the Solar Short argument is sunk.

Blah blah blah....

Another Thought: Tesla is coming. Tesla rocks. Tesla is American. Tesla is HYPED! There's BIG MONEY that believes in Tesla, and will buy it.

When Tesla comes out, will a new generation of Big Money be born (Overnight)?

When people see people beat the odds, they want to figure out how they did it. In comes Speculation and creative thinking. If money follows thinking, then the boom can come, and it can cross borders at the speed of LIGHT.

So, it takes roughly 1,995,000 Solar Panels to produce the equivalent in Energy to 105,000 Gallons of Gas per Day.

Multiply this times 200W per Panel gives a total of 399 MW of Solar Installation in order to equal the gas content of this single spill. If we assume that the remainder of the oil doubles the energy content of the barrel of oil (which I bet is giving false advantage to Oil), then we need 798 MW of Solar to replace it. This seems like alot. Just a few years ago there wasn't this much Solar Capacity in the World. Last year the World Installed about 7 GW of Solar Energy, or a bit over 8.7 offshore platforms, and this year we're looking at the possibility of 13 GW in new Installation, or the equivalent of 16 Platforms. It goes wild from there.

Now, at $4/W Installed, 798MW of Solar Energy would cost around $3.2 Billion Dollars, which is surely much higher than the cost to produce a single oil platform. On the other hand, it's surely alot less than what this disaster is going to cost BP for this particular Rig. In any case, the Price of Solar will keep coming down, while the price of fossils is going to keep going up.

Sunday, July 26, 2009

Photos from US spy satellites declassified by the Obama White House provide the first graphic images of how the polar ice sheets are retreating in the summer. The effects on the world's weather, environments and wildlife could be devastating

Satellite images of polar ice sheets taken in July 2006 and July 2007 showing the retreating ice during the summer. Photograph: Public Domain

Graphic images that reveal the devastating impact of global warming in the Arctic have been released by the US military. The photographs, taken by spy satellites over the past decade, confirm that in recent years vast areas in high latitudes have lost their ice cover in summer months.

The pictures, kept secret by Washington during the presidency of George W Bush, were declassified by the White House last week. President Barack Obama is currently trying to galvanise Congress and the American public to take action to halt catastrophic climate change caused by rising levels of carbon dioxide in the atmosphere.

Tuesday, July 21, 2009

We'll just have to see what happens when the whole plan is finally revealed. Should be interesting. These guys are jumping all over themselves to make sure that the Public doesn't buy Solar Stocks (particularly the Chinese ones). At some point the case will be clear, and what are they going to do? I don't know, but I'm sure we'll see some great examples of cognitive dissonance.

Wednesday, July 15, 2009

A Solar Cell performance degrades over time. The effective lifetime of Solar Panels are right now considered to be in the area of 25 years.

The rate at which a collection of cells degrades, on average, over the lifetime may not be a nice line.

I can only guess what the curve looks like for a standard Silicon, Wafer-based, Cell but I imagine that it's close to linear. If you have good data, I'd love to see it.

On the other hand, particularly when future cells have their efficiency enhanced by things like coatings, the curve could get alot more complicated. You might have a Silicon Solar Cell that will degrade linearly over 25 years, but the cell might be coated with a product that will increase its initial efficiency by a very significant amount, but which might degrade in effect completely after only 15 years.

Depending on the cost to add the coating, etc, it might very well be financially advantageous to buy this panel with a rapidly degrading initial phase, and a slowly degrading long term component.

The way I see it is that if, for example, a 100W panel were to degrade at 1% per year over its 25 year rated lifetime, then the effective Peak Power is really 87.5W. That's the effective peak power over the panel's lifetime, of PowerPeak-Lifetime25.

In the same way, if you had a panel of the same surface area area that was 160W, but it degraded at 2% per year for 15 years, and then 1% after that till 25 years, it would have an effective PowerPeak-Lifetime25 of 140W.

This would allow the customer to know what they're really buying over 25 years, even if it would take some estimations and tricky modeling on the part of manufacturers. They'd have to try to figure out with great care exactly what the FUTURE degradation curve of their product is going to look like. No worries, they'll appreciate the challenge. :)

In any case, if you're not reflecting rates of lifetime degradation in the cost per Watt, then there is trouble on the horizon for everyone involved.

EDIT: I suppose I spoke prematurely. I assumed that there wasn't a standard name for this. There must be. I ask then, what is it?

Tuesday, July 14, 2009

This is a marked contrast from previous energy secretaries, who often came from business or political backgrounds and had little experience in the energy industry itself, let alone the scientific community that many now hope will help the country move away from fossil fuels. President Reagan's first energy secretary tried hard to abolish his own department.

It just makes it hard to believe in humanity that this kind of thing is true. Sure, not many people understand Energy, or its real impact on their lives; I wouldn't understand it if I hadn't stumbled into Physics. Aw well, we've got a good Qualified Energy Secretary right now, and so I'll try to just keep looking forward. :)

Sunday, July 12, 2009

* China announced an upfront subsidy of RMB 20/W ($2.94/W)for BIPV projects greater than 50 kW and certain rooftop solarsystems for 2009* China introduces RMB 1.09/kWh preferential feed-in tariff forsolar power that supplies to grid* Jiangsu provincial NDRC announced a solar PV incentive plan,which targets a 400 MW on-grid installation over the next threeyears, with 260 MW for rooftops, 10 MW for BIPV and 130 MWfor ground-mounted systems. The plan also details a feed-intariff for each type of system, which may result in very attractiveIRRs* China announced it is planning a stimulus package worth RMB3 trillion to expand its renewable energy use. China targets toreach an installation capacity of 20 GW of solar power by 2020

This stuff was pretty well known by anybody watching the Yahoo Boards. Lots of articles have been coming through from China. So far it's been ignored, as if it were just rumor, but this puts it a bit past what I'd think could be considered rumor, though.

As for the 20GW goal by 2020, I've also seen reference to talk of an eventual goal of 70GW by 2020. Since the goal is reviewed every 5 years, they'll have the opportunity to raise it if the situation warrants it. In any case, the 20GW goal for 2020 should not be considered as a cap on capacity by that time.

LDK also points out 2-3GW in Framework Agreements in China, as well, but they don't give a timeframe for that total. These are another item that has been coming out in Chinese news stories, and I suspect that we'll actually see much bigger totals than this revealed soon enough.

I get the sense that the industry is in super stealth mode right now. You know that there are alot of people seriously working their butts off right now, planning for the projects to start in earnest, but they're definitely not speaking freely about it.

I can't help but wonder if there's a concerted effort not to upset the balance in Washington prior to ink hitting paper on Cap and Trade later this year (hopefully). If the Chinese make a bold move, then it could potentially be used against Energy Legislation by bringing up outsourcing to China.

Personally, I think that kind of event could be used to sell partnership with the Chinese on the issue of Climate Change / Peak Oil, and it could also whip up the American competitive spirit to good effect.

Disclaimer

The content contained in this blog represents the opinions of the author. The author, or associates of the author, may hold either long or short positions in securities of various companies discussed in the blog. The commentary in this blog in no way constitutes a solicitation of business or investment advice. In fact, it should not be relied upon in making investment decisions, ever. It is intended solely for the entertainment of the reader, and the author. In particular this blog is not directed for investment purposes at US Persons.